Virginia Village Landowner Pulls Out of Micro-Community Deal With City

A micro-community planned for 1380 South Birch Street in Denver's Virginia Village neighborhood is officially no more after the property owner decided to back out of a deal with the city, according to housing officials.

Mayor Mike Johnston has now lost sites for three micro-communities that were supposed to be pivotal parts of his House1000 plan.

On October 12, the city nixed plans for a micro-community at 1199 Bannock Street in the Golden Triangle. On November 2, Johnston canceled plans for a site that would have gone near the Holly Hills community at 5500 East Yale Avenue.

He announced the Virginia Village cancellation in a letter sent to residents of District 6 on November 8, citing "a combination of logistical and operational challenges, and economic vitality" as city concerns.

"When we started the outreach process, we listed these sites publicly so we could do two types of vetting," Johnston said. "One was specific vetting on the site and the logistics of that site preparation, and the second was broader feedback from the neighbors in the community about their thoughts on the site. After deep conversation and evaluation, we have decided to not move forward with the micro-community at 1380 South Birch Street."

According to the city's Homelessness Resolution Operations Center, it was ultimately the landowner who made the final call. "The landowner who originally offered the location no longer wants to move forward with a micro-community," the agency tells Westword.

The three sites that have been quashed have one quality in common: They're the only three micro-communities among the ten revealed in August that were slated to go on privately owned land.

Asked if the property owners of 1199 Bannock Street and 5500 East Yale Avenue had withdrawn their offers to host micro-communities as well, the HROC responds: "No, they did not."

"We are grateful to the many private landowners who have graciously come forward to present site options for our unhoused neighbors," the agency says. "As we have proceeded through the vetting and evaluation process of each of the preliminary sites that were identified last August, we are finding that some of the sites are not economically viable for various reasons. This was to be expected, and we are undeterred by these outcomes."

Right now, 1380 South Birch Street is just a dirt lot in Virginia Village located about two blocks from the southern edge of Glendale. The site is tucked behind single-family homes.

Virginia Village resident Kelly Berns tells Westword it "makes no sense" that a micro-community was ever planned for that location.

"The location literally was right next to single-family homes in a neighborhood with a Montessori school within 1,000 feet and Ellis Elementary School," she says. "I'm thrilled that it's nixed."
                   
The property at 1380 South Birch is owned by the Krisana Group, according to Denver property records; it's across from a large, vacant property that once held the headquarters of the Colorado Department of Transportation.

The Krisana Group is a real estate developer that plans to build an 800-unit apartment complex on the grounds of the old CDOT headquarters. It is registered to two different people at the same address, according to state records: Arthur McDermott, a senior advisor to the property management group ComCap; and John Michael Lengen, who is listed as an asset manager for Lexton McDermott, one of the largest for-profit housing developers in Colorado. McDermott is also a managing member there, alongside Michael Lengen, the president of ComCap management.

McDermott, the Lengens, Lexton McDermott, ComCap management and the Krisana Group could be reached for comment.
 
The South Birch micro-community cancellation comes as the city has already started breaking ground and erecting micro-communities in at least four other locations. The remaining seven micro-communities are going up on either city- or state-owned land.

Johnston's change of plans also leaves five city council districts without the burden of having to host a micro-community: Districts 1, 2, 4, 5 and 6. When unveiling the proposed sites, the mayor had promised that he wanted to distribute them "equitably," but residents have pointed out that no sites were planned for the city's wealthier neighborhoods, such as Cherry Creek or Washington Park, which are in Districts 5 and 6, respectively.

Johnston is now further from his distribution goal than ever before.

Meanwhile, some micro-communities are shrinking: The 1375 Elati micro-community in the Golden Triangle has gone from 51 units to 44 units, according to a new site plan obtained by Westword.

This all comes as Johnston gets closer and closer to the deadline to meet his House1000 goal of putting 1,000 people into temporary housing by 2024.

On November 8, the mayor insisted that Denver was still "on a path to be able to get there by the end of the year," despite recently admitting to Axios that he made a "mistake" by aiming so high, and likely wouldn't reach the 1,000-people mark.

The property owners involved with Johnston's two other scrapped micro-communities were Urban Villages, a real estate developer that owns 1199 Bannock Street in the Golden Triangle, and Jerrold Glick, a real estate investor who owns 5500 East Yale Avenue in the Holly Hills Pocket.

The three private landowners who offered space for micro-communities were all linked to donations ranging from $500 to $10,000 to Johnston's campaign for mayor or a super PAC supporting him, according to Denver campaign finance records.

McDermott and John Michael Lengen both donated $500 to Johnston's campaign on March 24. One of the co-founders of Urban Villages, Grant McCargo, donated $500 to the Johnston campaign on May 30. The president of the company, Jon Buerge, donated $500 on May 23 and $500 to Leslie Herod on September 21, 2022.

Glick donated $10,000 to Advancing Denver — a super PAC that supported Johnston's mayoral bid — on February 10, according to records. Glick gave the same amount to A Better Denver, which supported Chris Hansen's bid for mayor. His son, Fred Glick, is on the Denver Planning Board, which is responsible for advising the mayor and Denver City Council on land use.

Urban Villages has confirmed that it was in "early discussions" with the city about its micro-community in the Golden Triangle before it was canceled, but refuses to say more.

When asked about his site, Glick confesses: "I have no idea what the city is going to do at that site."